How to Play

One Fantasy Sports League is Connecting War Vets

Posted: Friday November 9, 2007 4:19PM; Updated: Friday November 9, 2007 4:19PM
By Melissa Segura

We want to believe in the happily-ever-after. That when the troops come home to the local high school band playing, families waiting, flags waving, the worst is over and they are finally free to begin tending to their lives, families and lawns. Everything that the American dream and the flag they've fought under is all about.

But pretty wives and cute kids aren't the only ones waiting for many of our service men and women when they come home. So too, are disproportionately high incidents of unemployment, divorce, and post-traumatic stress disorder are often standing behind the welcoming committee.

That's where fantasy football comes in. Hire A Hero, a non-profit Web site that aims to help returning veterans transition back to civilian life and find quality employment, has teamed with RotoHog.com, a relatively new portal in the fantasy sports arena, to create the Military Fantasy Football League (MFFL). On Sunday, the fantasy league designed specifically for the military community will launch with draft parties scheduled at military bases and online.

While drafting LaDainian Tomlinson or trading for Peyton Manning may seem like an odd way of tackling unemployment and post-traumatic stress disorder, the underlying premise is quite conventional: It's all about connecting.

"What you're trying to do is push people to meet each other," says Dan Caulfield, founder and executive director of Hire A Hero.

According to 2005 figures supplied by the Bureau of Labor Statistics, the most recent available, veterans had a higher jobless rate than non-veterans (17.2 versus 10.4 percent) among men 18-24. The National Center for Post-traumatic Stress Disorder estimates that 12 to 20 percent of vets from Iraq suffer from Post-traumatic Stress Disorder. What's key for alleviating both those ailments?

Social networks, like those found in rotisserie sports communities. While trading for a left tackle, veterans can also trade job leads and referrals. "Putting people together with a shared interest is often a great way for them to make a connection. That connection can last a lifetime," Caulfield says.

RotoHog.com's platform allows unlimited users who can be grouped according to military branch, battalion, and/or town, which means MFFL players can connect and compete with more than just 10 buddies in traditional leagues.

There is no science that says this will work, but RotoHog.com will ensure that there is at least a financial benefit to Hire A Hero. RotoHog.com says it will donate a portion of all ad revenue from MFFL to the charity, as well as 100 percent of the $10 premium statistical service fee players can register to receive the latest news, injury reports and advance scouting reports from the site.

The idea for MFFL was hatched about two months ago when a venture capitalist with RotoHog.com worked with the Hire A Hero program. He thought the social networking and job-hunting mission of Hire A Hero and the social bonds formed through fantasy sports could work in tandem. Despite the midseason start and the quick league formation, more than 500 service members and their friends or family members have registered for the league. Scott Philp, vice president for business development at RotoHog.com says that the league's goal is to register 2,000 MFFL players by Veteran's Day, and 10,000 by the season's end. The platform allows for a week-by-week play, meaning there's no penalty for starting the season in Week 10 or Week 10,000.

Jared Hansen, a Marine who completed his service earlier this spring, signed on mainly to bring back that same sense of camaraderie he had on those Sunday afternoons stationed on Parris Island, S.C., when he'd drink beer and catch the games with the fellas. Now living with his wife in Hicksville, N.Y., Hansen hopes some of the contacts he makes with other fantasy football players will help his fledgling graphic arts business.

"The last time I played I stunk terribly," he says. But this time it's about more than standings or scores, but about forming friendships. "Having that kind of outlet available to you is invaluable."

Source: http://sportsillustrated.cnn.com/2007/writers/melissa_segura/11/09/onthemoney/index.html

RotoHog is Doing Something Really Awesome

By Derrick Eckardt
October 23rd, 2007

RotoHog has partnered with Hire A Hero to create the Military Fantasy Football League. According to the NewsBlaze: Basic membership in the MFFL is free. Once an individual becomes a member of MFFL, there is an opportunity for them to buy a premium membership. 100% of revenues generated from premium memberships purchased by the members of the MFFL will be donated by RotoHog to the Hire A Hero cause. Weekly prizes will also be given to MFFL members.

This article also highlights something that RotoHog added to its revenue model this fall: Premium services. This puts the RotoHog game inline with Yahoo! and ESPN in terms of offering a free version with some paid upgrade features.

In my humble opinion, this is a really great thing for RotoHog to do. From a business perspective, aside from the good publicity it generates, this partnership helps RotoHog tap into one of the tightest-knit groups in the country.

Source: http://www.rotonation.com/?p=560

Happy Miscellany

By Stephen J. Dubner
March 7, 2007; 9:19 AM

“An interesting new fantasy baseball site, RotoHog.com, has a trading floor and prizes of up to $100,000. True devotees should read this commentary by Aaron Brown, author of The Poker Face of Wall Street.”

Fantasy season for Wakaw man

By Cory Wolfe, The StarPhoenix
Published: Tuesday, February 05, 2008

As an ardent Philadelphia Eagles fan, Chris Peterson says he cringed each time he added a Dallas Cowboy to his fantasy football roster.

He's not wincing anymore, though.

The 34-year-old Wakaw resident earned $100,000 US by outwitting more than 50,000 armchair quarterbacks in the RotoHog.com Fantasy Football League.

"My wife (Crystal) and I tried to stay as skeptical and as grounded as we could," says Peterson. "With about three weeks left in the season, I let myself think, 'If I don't screw this up, I could win 10 grand.' That was the third-place prize. Then it was $25,000 for second and $100,000 for first."

Peterson's roster -- which he named Green Machine as an homage to his two favourite teams, the Eagles and the Saskatchewan Roughriders -- proved unbeatable. Entry was free, but Peterson paid $9.99 US for an upgraded statistics package. He's scheduled to pick up his prize Saturday during an awards ceremony in Los Angeles.

Peterson says he had a simple strategy -- ride the best players, the go-to guys. He wasn't one for playing hunches on second-rate players.

"A lot of guys will pick one guy, who might not be the best and take a chance on him on a weekend," says Peterson, who first played fantasy football three years ago with friends. "My strategy was to play the best player all of the time."

Offensively, Peterson relied heavily on New England's record-setting tandem of Tom Brady and Randy Moss, plus running backs LaDainian Tomlinson (San Diego) and Brian Westbrook (Philadelphia). Unlike traditional fantasy leagues, multiple RotoHog competitors could own the same players. Rosters evolved by buying and selling players in a virtual stock market.

"The prices of players go up and down, based on supply and demand, just like stocks would," says Peterson, a SaskWater employee. "You have to make a bunch of money, especially at the start of the year. Then for the last half of the year, you can buy whichever player you want. I had made enough money so that on Sundays I could put in whoever I wanted. You have to do that because otherwise you can't compete against somebody who can play Brady, Moss, Tomlinson . . ."

Peterson is RotoHog's first-ever fantasy football champion. The website debuted last spring with a fantasy baseball league. Bryant Martin, RotoHog's vice-president of marketing, says the site generates its revenue through advertising and the optional statistics packages.

"In this particular league, to win the $100,000, (Peterson) was competing against our entire customer base," says Martin. "It's not a series of small round-robin leagues.

"For 17 or 18 weeks, you have to stay on top of what you're doing and keep an eye on things daily."

Peterson, a father of two, says he has both practical and adventurous plans for his windfall.

"My wife put me through school and she's just finishing up her education degree at the U of S, so there's a lot (of bills) from that. But we haven't taken a real good family vacation for a long time, so we'll probably spend a bunch on a real vacation."

Peterson also plans to defend his title next season.

Source: http://www.canada.com/saskatoonstarphoenix/news/sports/story.html?id=3c557b55-1eae-47ad-9b4e-e5d17303c927&k=50943

Aaron Brown, the author of The Poker Face of Wall Street excerpt from post by Alex

March 4, 2007

If you are not a financial professional, you may have wondered why people get so excited about futures trading. You probably understand that you can make a lot of money if you bet correctly that pork bellies will increase in price or that frozen orange juice will fall. But that’s just gambling and the price patterns are random enough that it’s not much easier for an outsider to make money in the futures markets than in Las Vegas. So why do people care so much? Why does the opening of a trading market completely change the game and create entirely new economic opportunities? After all, people are just buying and selling pieces of paper representing stuff that people could buy and sell in real markets before the futures exchange opened.

If you know more about fantasy sports than economics, you can now see the reason demonstrated. RotoHog.com’s ingenious game completely changes the way you have to think about fantasy baseball, and sets an entirely different basis for player valuation. I’m going to begin the discussion ignoring the bid/ask spread rotohog.com is imposing on their trading floor. It’s easier to understand the impact of perfectly liquid trading before dealing with some of the complexities of transaction costs.

Let’s start with traditional fantasy valuation. You begin by projecting the stats of the available players. I just used their 2006 stats, so I’m valuing them for last year, under the assumption you knew exactly what each player would do. This produces unrealistic top valuations, because the best performers always do better than expected. That is, you might guess that the best fantasy hitter in the majors will have a season as good as Albert Pujols did in 2006, but at the beginning of 2006 you won’t know which hitter it’s going to be. You expect Pujols to have an excellent season, and he’s among a handful of hitters who might turn in the best overall season, but you have to price him before you know he’s going to be the best.

The top price I get for any player is $76.75 for Johan Santana, but at the beginning of 2006 he was probably worth more like $50 to $55; he might have gotten injured, he might have had a disappointing season, he might have just had a pretty good season. You wouldn’t be sure in advance that he’d lead the league in both innings pitched and ERA (and just about everything else). By the way, I use www.dougstats.com for data and my stats and positions sometimes differ slightly from the ones at rotohog.com.

Once you figure out how many points each player can be expected to generate, you take the top 12 players for each slot. The 13th best catcher in the majors in 2006 was Mike Piazza of the Padres, who produced 513 points. Since only 12 catchers will play in the fantasy league, Piazza is worthless. The top catcher, Joe Mauer, produced 921 points. But since you could get 513 for free, you’re paying for the extra 407 (numbers do not add due to rounding). This assumes there is no value to keeping players on the bench, you could add some small value to Piazza for that. Things are a little trickier to deal with utility players and optional pitching slots, but the basic idea is you rate each player based on the extra points they give you versus the 13th best player available for the slot. Sophisticated fantasy owners can refine these methods, but this is the basic idea.

If you add up all the extra points (that is, points above what the 13th best player will give you for free) from the 180 players who will fill all 12 fantasy rosters, you get 24,026 for hitters and 14,377 for pitchers. Add those numbers and divide by the $3,600 available to all 12 fantasy owners and you get $0.0937 per extra point. Mauer gave you 921 extra points, so he’s worth $38. If all the players are priced this way, and all owners spend their $300, there will be a 12-way tie for first. The top line-up given these assumptions is:

Player Team Pos Points Value
Garrett Atkins rock 3B 1,198 $45.43
Carlos Beltran mets OF 1,247 $50.00
Lance Berkman astr OF 1,216 $47.10
Chris Carpenter card P 1,142 $45.14
Ryan Howard phil U 1,321 $56.95
Joe Mauer twin C 921 $38.18
Joe Nathan twin RP 1,156 $46.47
Albert Pujols card 1B 1,418 $66.03
Jose Reyes mets SS 1,211 $51.94
Franc Rodriguez ange RP 1,168 $47.60
Johan Santana twin SP 1,479 $76.75
Alfonso Soriano nati OF 1,194 $45.07
Chase Utley phil 2B 1,139 $48.87
Brandon Webb diam SP 1,143 $45.26
Carlos Zambrano cubs P 1,105 $41.73

This line up would cost $752.52 and give you 18,057 points. Of course, you could never afford it in a traditional fantasy league. The key to this analysis is your constraint is slots, you can have only one player per slot. Now we’ll see how having a liquid trading market changes the constraint, and thereby the basis of valuation, and thereby completely changes the relative values of the players.

I looked at the schedules for the Anaheim Angels (picked because they were first on the list) and the New York Mets (picked because they’re on the other coast and in the other league). Over 2007, there are 28 days on which only one of the two teams is playing, 90 days when both are playing but the games (based on television slots) do not overlap and 58 days on which the two teams have games that overlap in time.

Carlos Beltram was the best fantasy outfielder on the Mets in 2006 and Vladmir Guerrero was the best on the Angels. Suppose that you could buy (and sell) each of them for $45 for the 2007 season. You draft Beltram for $45. After he plays in April 1, you sell him and buy Guerrero, who plays on April 2. You continue buying and selling, always holding the player who has a game. If the Mets and Angels have overlapping games, you pick one outfielder at random. By the end of the season, your $45 has bought you not 162 games, but 266 games.

Of course, you’re limited to 162 games per outfield slot. So budget another $45 to add Lance Berkman and Alfonso Soriano to your platoon. You can move the four dream-teamers around among the three outfield slots to be sure you have 162 games in each slot, a total of 486 outfield games. If one of the four falls off in production, or another player climbs up to their level, you can switch. You have the best outfielders in baseball playing every game, spending only $90 for to fill three slots.

The table below shows the results of this strategy for 2006. You always buy Beltram and Berkman if they have a game. If Soriano is playing, and one or both of Beltram and Berkman are not, you buy Soriano. You buy Guerrero for a few games when you don’t have two slots filled to get your total outfield games up to 486. This produces a total of 3,907 points. It uses a maximum of $97.10 at any one time, and often uses less. You never have more than two outfield slots filled at a time (the rules allow you to leave slots empty, but even if they didn’t, you could fill them with $0.25 scrubs who do not have games that day).

Player Team Pos Innings Points Value
Carlos Beltran mets OF 140 1,247 $50.00
Lance Berkman astr OF 152 1,216 $47.10
Alfonso Soriano nati OF 159 1,194 $45.07
Vladim Guerrero ange OF 35 249 $37.24

Suppose instead you elected to buy and hold Grady Sizemore, Bobby Abreu and Andruw Jones. This will cost you $101.76 all the time, instead of a maximum of $97.10 and often less. You will get 3,226 points, 680 less than the platoon strategy. Some of the difference comes from not using up all 486 games, but most of it comes from getting fewer points per game because the players you can afford to buy are not as productive as the players you can afford to rent when you need them.

Player Team Pos Innings Points Value
Grady Sizemore indi OF 162 1,104 $36.57
Bobby Abreu tota OF 156 1,064 $32.88
Andruw Jones brav OF 156 1,058 $32.30

Pitching offers even more opportunities to platoon. Starting pitching is worthless, because there is a limit of 1,300 innings for all pitching slots combined, and closers are put up about three times the points per inning as starters. Suppose in 2006 you had bought the four best closers playing at any given time, until you got up to 1,300 innings. You would have the following contributions:

Player Team Pos Innings Points Value
Chad Cordero nati RP 73.3 857 $18.48
Francis Cordero brew RP 26.7 429 $0.00
Brian Fuentes rock RP 65.3 766 $9.93
Mike Gonzalez pira RP 54.0 662 $0.18
Tom Gordon phil RP 59.3 787 $11.93
Trevor Hoffman padr RP 63.0 986 $30.60
Jason Isringhausen card RP 58.3 715 $5.12
Bobby Jenks whit RP 69.7 884 $21.00
Joe Nathan twin RP 68.3 1,156 $46.47
Akinori Otsuka rang RP 59.7 767 $10.05
Jon Papelbon rsox RP 68.3 1,060 $37.47
J.J. Putz mari RP 78.3 1,075 $38.89
Chris Ray orio RP 66.0 839 $16.74
Mariano Rivera yank RP 75.0 950 $27.23
Franc Rodriguez ange RP 73.0 1,168 $47.60
B.J. Ryan blue RP 72.3 1,073 $38.75
Takashi Saito dodg RP 78.3 962 $28.34
Huston Street as RP 70.7 893 $21.88
Billy Wagner mets RP 72.3 1,044 $35.95
Bob Wickman tota RP 54.0 682 $2.07

The total is an astounding 17,756 points. This is only slightly less than the 18,057 a buy-and-hold owner could earn with an unlimited budget and perfect foresight. And you get it all from relief pitching. One of your contributors, Francis Cordero, would not even be playing in a traditional league, and another, Mike Gonzalez, would be worth only $0.18. When the top closers are all playing, you have to devote $171.71 of your budget to owning Rodriguez, Nathan, Putz and Ryan. But most of the time you have less than $100 allocated to relievers, with the rest available to rent hitters.

The infield positions use the same idea as outfielders and pitchers, except you have to pay attention to make sure you’re getting enough games at each position individually. So instead of getting the best hitters playing at any given time, you have to spread games around among the best catcher, the best shortstop and so forth. You need 162 more games to fill the utility slot, but you can use any batter for those, so it makes sense to fill them only after a defensive position has its full quota of 162. Generally, you’ll fill it with games from outfielders, first basemen and designated hitters.

So far, I’ve assumed everyone else sticks with traditional fantasy valuation. In reality, a lot of people will start platooning. That will drive up the values of the best players, especially relief pitchers, at the expense of the others. Also, a player’s value will be highest right before his team has a game (or right before he has a start for a starting pitcher) and drop afterwards.

This last point is crucial, and changes the valuation equation again. If you follow the obvious platooning strategy above, you will lose money on each buy and sell. You might buy Carlos Beltram for $45 just before he plays on April 1, and find he’s only worth $44 after the game. No one wants to buy him until just before his next game on April 3. You can’t wait for that, because you want to sell him and use the money to buy Vladmir Guerrero for his April 2 game. These game-by-game losses will erode your initial $300. If you don’t do anything about them, you’ll be forced to choose between settling for less than the best players, or not filling all your innings and games. You won’t be able to keep enough stars in play to add up to 162 games per batting slot and 1,300 pitching innings.

One way around this would be to use your traditional fantasy skills. You could buy relatively cheap players who deliver good stats, and hold them for price appreciation. You could watch for games in parks or against pitchers where certain batters can be expected to do much better than their average; or closers in situations likely to offer a save opportunity.

You may have noticed that my entire discussion has ignored these factors, in fact anything to do with baseball or talent evaluation. Professional traders in the financial markets have to know little or nothing about the underlying economics of what they trade. You may now see why that’s true. My strategies demand only basic projections of value that any casual fan would have, or can be easily found on the internet. I’m going to concentrate on analysis that assumes you do not have superior knowledge of baseball. If you do have that knowledge, you can use it to refine the strategies. But trading skills are far more important than baseball skills at rotohog.com.

The trader’s way to recoup the money lost from buying players just before games and selling them right afterwards is to lend out spare cash. Suppose, for example, that at one point you are playing only four players for some reason, with $150 total salary. You have $150 idle. You can use this to buy players who have just finished games, with the idea of selling them just before their next games. You should earn a reliable profit doing that, replacing losses from other transactions. In the financial market, this is known as a “reverse repo” transaction (for “repurchase agreement,” the person on the other side, who is effectively borrowing your $150, is doing a repo). You are doing a mental reverse repo, that is you have made up your mind to resell the player and are buying him only to earn interest on spare cash; in a real reverse repo you sign a contract to resell him. The repo market is one of the most common ways a trading organization earns interest on its spare cash, or borrows extra money to fund short-term trading positions.

One danger in all this is holding a player at the time he gets injured. You might buy him for $40, planning to sell him for $38 after the game. In your mind, you’re renting him for one game for $2. But if he gets a season-ending injury, you lose the entire $40. And injuries are just an extreme case of value volatility. A player’s value may fluctuate depending on his performance or other factors. If he has a bad game, you may end up paying $4 as his price drops to $36 instead of $38. If he has a good game, you might get him free, or even earn a profit from having him.

That’s why the real world developed futures markets. If rotohog.com added those, you could buy him for $40, agree in advance to sell him for $38 after the game (healthy or dead, great game or terrible, it doesn’t matter). That way you get the game for $2 as you wanted. Someone else takes the risk of value volatility.

Player health and performance are not the only risks. You never know if a closer will pitch. A rain-out can wipe out the game for all players. In these cases, you don’t lose principal, but you don’t earn the expected return. An east-coast game may go into extra innings, frustrating your plans to sell one of the players in it to buy a player for a west-coast game the same day. You don’t lose money on your long position (owning the player), but the funding costs were higher than expected (you pay “interest” over two game windows instead of one), which has the same effect.

The next evolution in the real world is specialized institutions to help with these activities by trading in the markets, just like other participants. One institution might take spare cash from owners and pay a fixed rate of interest, then use the money to hold players in between games. It is effectively providing banking and insurance services to other owners. Another institution might sell derivatives, such as the stats to the next game a pitcher pitches, regardless of the day it happens, or the stats to his next nine full innings, or the best stats posted by any shortstop on a given day. This allows owners to pursue more flexible strategies, while financial engineers can create the derivative payoffs by buying and selling in the underlying player market. These institutions cannot evolve at rotohog.com, because you can’t transfer money among players, and the institutions would build up a lot of fantasy cash in profit, but that would be worthless without stats.

Another difference between rotohog.com and real markets is that you cannot short players. In a fully-efficient market, you can sell players you don’t own (called “shorting”). Their stats would be subtracted from your totals, but you could use the money from selling them to buy other players who would (hopefully) more than make up for that. You would also hope the players you shorted went down in value, so you could buy them back for less than the original sales price; thereby making a profit. You could short players between games, effectively borrowing money to field a more expensive team than your bankroll supports. Your stats wouldn’t suffer, because the player wouldn’t play. But since player value tends to rise in between games, you pay an expected cost for this borrowing. Another strategy would be to leverage your slots by buying games from all-stars, then shorting scrubs to reduce your games-played total without much decrease to your point total. This could dramatically increase the gain when you’re doing well, but increase the losses by the same ratio when you’re doing badly. One effect of shorting is that true scrubs would acquire negative values, you would be paid to own them, and would have to pay to remove them from your roster.

A key economic statistic in the rotohog.com world is the interest rate versus the cost-per-game of owning a player. If the effective interest rate is relatively high, team owners can pursue the platooning strategy without much constraint. All the value will be concentrated in the top players. But if the interest rate is relatively low, team owners will have to allocate more cash to holding players between games to earn interest. This will distribute value more evenly among players.

The interest rate and the cost of ownership are clearly related. If players drop a lot in value immediately after games (high cost of ownership), they can be expected to rise a lot before the next game (high interest rate). But the two amounts will not be equal, because the season has a finite length. The initial endowments ($300) set the initial prices. Rational owners who plan perfectly want to be broke by the end of the season (there’s no reward for having spare cash left in your account, or players on your roster at season end). We therefore expect inflation as the season continues. Stats have constant value, but money heads to zero value. So we expect the loss from owning a player for a game to exceed, on average, the profit earned from holding the same player between games. The average difference should be about 1/162 of the initial player value ($0.25 for a $40 player), but it could vary considerably during the season, and even become negative in some circumstances.

But not everyone has to go broke at the same rate. One owner might choose to spend recklessly at the beginning of the season, when cost of ownership is lowest, hoping to fill up his 162 games and 1,300 innings by June with an insurmountable lead (and no money or players left). Another might choose to compile no stats early in the season, holding players only when they have no games, hoping to build up a large enough bankroll to buy victory in August through September. Most owners will pursue alternating strategies, piling up stats and spending money when they judge the price of talent is relatively low, and ignoring stats to pile up money when they judge the price of talent is relatively high. And the game might not be the same for all positions. There may be times when outfielders are cheap and pitchers dear, or vice versa.

Things are complex because two prices matter. Absolute price limits the number of players you can play at one time. The price drop from before to after a game is what you have to pay for one game’s stats. Traditional fantasy owners are looking only at absolute price, and are holding full rosters all the time. Trader owners concentrate mostly on rental cost per game. They might have only 8 of their 15 roster spots filled on average, buying and selling intraday to get 15 roster spots of production without ever owning 15 players at once.

In the real world, we have the Federal Reserve (and other countries have their central banks) to worry about the relation between return on real assets (cost of owning a player during a game) and interest rates (profit from owning a player between games). The Fed can change the rules, and buy and sell securities, to keep the supply of money in line with the demand for assets. In the real world, the season doesn’t end, and the Fed doesn’t want people playing as if it does (that results in first inflation, then a crash, just like the season end in fantasy baseball). In the game, the people running rotohog.com have the ability to adjust several parameters. My guess is they’ll use them to keep the amount of trading high enough to distinguish rotohog.com from traditional fantasy leagues, but low enough that baseball acumen matters more than trading skills. I’d say that means top owners having turnover ratios of about 100% per month (the average player stays on the roster for a month); most owners will trade much less, and not be in contention as a result; owners who try to trade more will find it suboptimal. Of course, I have no connection to the site, so I could be wildly off in my guesses.

That brings up the bid/ask spread, rotohog.com’s primarily “lever” for regulating the marketplace. The real-world Fed regulates interest rates (it sets the Discount Rate and influences the Fed Funds rate strongly), rotohog.com has instead chosen to regulate via real asset returns. The example in the rotohog.com rules is $0.50 on a $30 athlete. It’s not a true bid/ask spread, it is a transaction cost imposed by the market regulator.

If all owners played perfectly, the bid/ask spread should eat up endowments over the course of the season so everyone ends up broke. At $0.50 per trade, that’s 600 trades. If the entire $300 were eaten up by bid/ask spread, there would be nothing left for a spread between interest rates and the cost of owning a player. Player values would stay constant, on average, throughout the season. The natural inflation of the rotohog.com economy from the season winding down would be kept in check by removing money from the system via transaction fees.

It doesn’t take a prophet to know owners will be far from perfect. Many will sign up and never look at the site again. Others will fall behind in their leagues, and be far out of the running for the overall cash prizes, and give up. Many who do play actively will fail to grasp the difference between rotohog.com and traditional fantasy leagues, and will buy and hold good players, hoping for good stats and price appreciation.

Since lots of owners will not be thinking in terms of spending their money and ending up broke, not all the initial endowments will be eaten up by transaction costs. Active owners will spend some of their $300 on net losses from owning players during games versus earning income by holding players between games. This extra money will go to the smarter traditional owners, who will use it to improve gradually the quality of their teams through long-term acquisitions. Some of them will end the season with an all-star roster valued at $600 or more, but without filling their quotas of 162 games per spot or 1,300 innings, and without getting major-league best stats from the games they do have. We’d expect Warren Buffet to play this way if he enters. They’ll win their local leagues with huge leads over owners who didn’t trade much, or who relied upon baseball acumen rather than economics, but they won’t be in contention for the overall money spots. The $100,000 will go to a hedge fund guy with great trading skills and the luck not to blow up.

Because there is a net cost of ownership (you lose more money owning a player for a game than you gain holding him between games), the entire $300 initial endowment is not available to pay bid/ask spreads, so owners should trade fewer than 600 times per year. The average price of players has to fall, because money is leaving the system but players aren’t. Top player values should increase. This will be more than offset by decline in the values of lesser players. The decline will start from the bottom, the players with lowest initial values will fall to zero, as owners fill up position slots with 162 games. If you want to win your league without much effort, draft only closers, stars and scrubs, then swap them for all starting pitchers and second-tier players as the season progresses.

If you want to win the $100,000, my advice is to draft the seven best relief pitchers you can get, then trade up for better ones as soon as the market opens. Use your additional money, if any, to buy only stars and scrubs. Focus entirely on closers, activating your four best ones for every game opportunity and swapping in the trading market to pick up extra innings (that is, if you don’t have four closers playing at any given time, sell one to buy a closer who is playing). Your goal is to accumulate closer innings as quickly as possible.

Never play a starting pitcher, this uses up precious pitching innings. Don’t worry about your batting slots. Use your extra money, when available, to purchase stars; but never miss a closer opportunity to get a superstar hitter. You’ll make up your hitting games later in the season.

As people catch on to the game, the value of closers and star hitters will soar. Since you’ll have lots of closer innings already, you will be able to take profits to buy more star hitters. With luck, you’ll be able to fill up 162 games at each hitting slot, using only stars. As the season progresses, you may find that even with your profits from owning relief pitchers and stars early, the price of top hitters has increased so you can’t play enough of them at a time to get your full quota of games. If that happens, you’ll have to drop down in hitter quality. Remember, even a player with zero value in a buy-and-hold league produces valuable stats. The 13th best player at a position typically gives you about 2/3 of the points of the best player. You don’t want to waste games early on average major leaguers, because you might be able to fill them later with stars. But if it becomes clear you cannot fill your games with stars, don’t miss the opportunity to fill them period.

So focus on closers, then on batting stars, platoon early, chart interest rates and player-ownership costs, seize the best available opportunities whether for stats or cash and figure you can even things out later; and be sure to invite me for the party celebrating your $100,000 payout.

http://rotohog.blogspot.com/2007/03/following-article-was-written-by-aaron.html

Podcast: Patrolling the Waiver Wire

By: Corey Koehler
9-2-2007

Source: http://mvn.com/nfl-fantasy/2007/09/02/podcast-patrolling-the-waiver-wire/

Week 1 Podcast: Start ‘Em or Sit ‘Em

By: Corey Koehler
9-6-2007

Source: http://mvn.com/nfl-fantasy/2007/09/06/podcast-startem-or-sitem-week-1/

It’s Fantasy Football Time

By Paolo Lucchesi
8/9/2007

Attention dorks!

With training camp in session, the Niners poised to turn some heads and the temperature–or at least the fog–rising for the next month or so, there’s no better time to be confined to the indoors.

That’s right: it’s fantasy football season. So get your scouting reports ready. Read up on Eric Karabell. Concoct a strategy (conquer Australia, conquer the world). Before you know it, you’ll be knee-deep in stats and checking the television listings for Houston Texans games.

But fantasy football, done right, is quite the endeavor, especially if you’re competitive like us. When embarking on the quest for a championship, the first hurdle is choosing a platform. Yahoo! and ESPN are probably the most popular destinations, but we recently came across a fantasy football site by the name of RotoHog.

The weird–or unique, rather–thing about RotoHog is that it’s more of a Web 2.0 version of your typical fantasy league. Also, the drafting process is a bit … capitalistic. As we understand it, it’s basically a free-for-all, open-market draft that sees 12 managers a chance at taking any player at the same time. For example, once the bell rings, all 12 managers choose a player simultaneously, but if Manager A takes LT in the first five seconds (before anyone else), LT’s off the board. We see a lot of potential for panic.

If only the real sports leagues adopted this draft. Imagine if every team had a shot at Greg Oden. Of course, it could backfire and if you get flustered, you could end up with a Mike Dunleavy.

Good times.

Source: http://sayhey.wordpress.com/2007/08/09/its-fantasy-football-time/

The New ROTOHOG.com $100,000 Fantasy Football Game

By Mike Kuchera
8/17/2007

WOW! By February 2008, RotoHog.com will have paid out over $200,000+ in fantasy baseball/football prizes, now where else in the world can you win that much money playing fantasy sports? Oh, and did I mention it was free??

With the success of the beta version of RotoHog's first salary cap fantasy baseball game, now comes their football version. Its Marshall Faulks $100,000 Fantasy Football Challenge, and once again, its free to join! The great thing about RotoHog's fantasy game is that you get the freedom to join as many leagues as you want with any kind of experience level you feel comfortable with, all the while still competing in the mega global league for the $100K. Also, RotoHog will be giving away other prizes within all the special leagues that are set up. And that's not all....if you are the one who refers the actuall $100K grand prize winner, you receive $50,000 just for introducing that friend to RotoHog giving you a hefty incentive to call all your friends, family and co-workers. There are so many ways to win different prizes, its almost mind-blowing.

The fun about this game is that you get to buy and sell players in real time based on supply and demand with the feel of wheelin' and dealin' with the stock market. You can create your own private leagues with as many players as you like, its unlimited and its still FREE! Just keep in mind that you'll have to keep on top of your team every week, because you'll be playing against some of the worlds best fantasy players!

Over the course of the season, I, The Fantasy Man, will be digging up some dirt on how to stay competitive in this game. With thousands expected to register right off the bat, or the tee I should say, you want to get all the advantages you can before draft day. So stick around here at Fantasy Football Express and take a listen to the podcasts as I will be randomly inserting some quick RotoHog tips as we approach the beginning of the season.

So sign up NOW for your chance at the only $100,000 grand prize in fantasy sports! Go to http://www.rotohog.com/ for details and registration!

Source: http://www.fantasyfootballexpress.com/2007/08/new-rotohogcom-100000-fantasy-football.html

Cumulative Clip Report

RotoHog.com Launches Fantasy Football Site

8/6/2007

Los Angeles-based RotoHog.com said today that it has launched a new, online fantasy football league along with former NFL running back Marshall Faulk. The new site said it will award cash and prizes to participants who enter their fantasy teams. RotoHog.com also revealed that it has received funding from Allen & Co, DJF DragonFund, Mission Ventures, and SCP Worldwide, although no details of that funding were released.

RotoHog's web site also provides profile pages, message boards, and other ways to interface with other fantasy sport fans. Leo Spiegel of Mission Ventures and Andy Tang of DFJ DragonFund China sit on the company's board of directors.

Source: http://www.socaltech.com/rotohog_com_launches_fantasy_football_site/s-0010527.html

Fantasy Sports Site RotoHog Scores $6M

By Ty McMahan
8/8/2007

Sports Composite DE Inc., which operates fantasy sports site RotoHog.com, has scored a $6 million Series A round of funding that will be used to expand the site into new sports.

The round was co-led by DFJ Dragon and Mission Ventures, with participation from Allen & Co. and SCP Worldwide.

RotoHog's hook is that it offers a completely different trading model than traditional fantasy sites.

"We eliminated the traditional way of trading players and created this trading floor that eliminates a lot of the unfair practices in the game today," Chief Executive David Wu said. "Instead of a traditional draft, we have a draft that allows hundreds of people to participate at the same time. We create this stock market feel of people on the trading floor when the opening bell sounds."

But Wu stressed that the RotoHog platform is not a trading game. He said it still holds true to the traditional goals of fantasy sports.

"It's a fantasy sports game where making the right pick and playing the right player each week is most important," Wu said.

Currently, RotoHog offers platforms for football and baseball. The recent round of funding will be used to expand into new sports, Wu said. The site generates revenue through advertising and premium memberships that provide players with additional research tools.

Wu said Los Angeles-based RotoHog was created in 2006 as he looked to legitimize his hobby.

"I've been playing fantasy football for ages," Wu said. "It got to the point where my wife was threatening me because I was spending so much time on it. My wife was not happy. I thought a way around this was to start a company for fantasy, so she would have to be supportive."

RotoHog – A New Twist on Fantasy Sports

By Dan Kaplan
8/8/2007

RotoHog, a site with an original approach to online fantasy sports, has raised $6 million in its first venture round.

There’s no revolutionary technology here; it’s just an effort to enhance an existing concept, and reflects the significant push to make money entertaining the masses who are spending ever more time online. For those who aren’t familiar, fantasy sports are like massively-multiplayer online role games, except for sports nuts instead of geeks. Fans spend multiple hours in front of their computers, building and managing teams. The point is to win bragging rights, and, if you’re willing to pony up an entrance fee, some real cash.

In the standard fantasy sports scenario, like those you will find online at ESPN, CBS, or Fox Sports, you set up a league with 10-12 friends or internet strangers and spend a few hours drafting the teams. Throughout the season, trading players can be an irrational process, where people over-value players for emotional reasons. In cash games, it can even be corrupt, when a losing competitor trades high value players to potential winners in exchange for a piece of the pot.

RotoHog, however, is different in a number of ways. Its two main hooks are its drafting method and trading system. In most fantasy sports, the drafting order is arbitrary and therefore unfair. RotoHog seeks to change this by creating chaos: After a countdown, the draft begins for everyone at the same time; and people draft players by clicking on them before anyone else. It’s a mad rush that in theory gives everyone an equal shot. Each draft round lasts two minutes, and the whole thing is over in 25 minutes. This is significantly faster than the traditional method, which gives each player two to six minutes to make each pick.

The trading system also strays from the norm: Instead of inflated values set by an individual manager’s perceptions, the value of players is based on supply and demand. RotoHog has a “trading floor” that functions like a stock market, where prices for players rise and falling in real time. This eliminates the possibility of collusion, and gives everyone the chance to build a winning team.

The $100,000 cash prize “Marshall Faulk League,” which pits your team against every other team on the site, is free, setting RotoHog apart from companies like the Ultimate Fantasy Football League, where prices range from $40 to $300, depending on how many teams you want to manage at the same time.

RotoHog plans to make money through advertising, premium services, and small contests — the precise nature of which the company has yet to flesh out.

The funding was co-led by DFJ Dragon and Mission Ventures, with contributions from Allen & Co. and SCP Worldwide.

Source: http://venturebeat.com/2007/08/08/rotohog-a-new-twist-on-fantasy-sports/

RotoHog Launches Free Fantasy Sports Leagues

By Kristine Nicole
8/8/2007

RotoHog is a new community for fantasy sports, full with sports leagues and cash prize contests.

You can form leagues with friends or join a public league. The difference with RotoHog is its attempt to change the fantasy sports game in terms of the draft and its trading systems. Managing your drafts and trades happens in a real-time environment and evens the playing field for all members involved. This may be more fun for some, and offers more social features that align with web 2.0 concepts. Your team will be entered into its Marshall Faulk league, making you eligible for the $100,000 grand prize and weekly prizes capping off at $30,000.

While participating in the leagues is free for members, there are a few premium services included in RotoHog that you can pay for. These include real time player price updates, scores and stats, chat, market analysis, extra public and private leagues, and watch list and player alerts. So while you can participate freely in the open market that RotoHog has to offer, you’ll have to pay in order to be the best in the league. Premium services start at about $10, which is peanuts compared to the $100k you could win, right?

Yahoo is also adding some features to its own sports fantasy games.

Source: http://mashable.com/2007/08/08/rotohog/

RotoHog: Fantasy Sports - Real Money

By Toni DasGupta
8/10/2007

RotoHog, an Inglewood CA based fantasy sports site raised $6 million in a Series A round, let by DFJ Dragon and Mission Ventures along with Allen & Co. and SCP Worldwide.

RotoHog is a free website that allows visitors to “manage” a sports team, and the game has a real exchange floor, where players are traded. Gamers have the opportunity to win up to $100,000. Besides that, those who refer players, get another 50% in (real) prize money.

The $6 million capital raise will be used for RotoHog to expand into other sports, beyond football and baseball. They have a social component already, with fans setting up their profiles, and chatting with other enthusiasts.

All this brings up the question, what is their revenue source? At present there is no obvious ad. placement. No doubt, a targeted site like this one, would, with a large enough fan following, bring in a fair amount of niche advertising revenue.

rotohog fantasy sports

Source: http://www.bizorigin.com/2007/rotohog-fantasy-sports-real-money/

Website Offers $100,000 to Fantasy Football Champ

By Stephen Dorman
8/22/2007

Fantasy football season has officially arrived.

While traditional headtohead or point-based scoring leagues continue to gain mainstream popularity, the folks at RotoHog.com are offering something a little less conventional for its users this season.

The online company cofounded by David Wu, a longtime Thousand Oaks resident who now resides in Simi Valley, has launched its inaugural fantasy football campaign.

RotoHog owners build teams through a free-for-all draft. Unlike standard fantasy football leagues, there is no set order of selection.

Once the season starts, RotoHog utilizes a global marketplace to determine NFL players' values, which are in a constant state of flux. An NFL player is released into the system once for every 12 fantasy teams that are signed up, Wu said.

On the RotoHog trading floor, players are bought and sold like stocks. Trading players is not allowed, and each team must adhere to a $300 salary cap with no roster size limitations.

Earlier this year, RotoHog launched a similar game for fantasy baseball. Wu said his company has made a few adjustments since transitioning to football, but the overall concept remains intact.

"We learned a lot from baseball," Wu said. "We've had a lot of feedback and really learned how everything works. The core, the spirit of the game, it remains the same."

According to Wu, the supplyand-demand system being utilized by his company allows for a fastpaced style of play that is difficult to match in standard scoring leagues.

"People love it," he said. "Some spend hours on the website."

RotoHog owners will have an opportunity to play for big-time cash in the free Marshall Faulk League, where the grand prize is $100,000.

Faulk, the legendary running back and perennial fantasy stud during his playing days with the Indianapolis Colts and St. Louis Rams, is not only the face of the league; he's a team owner and part of the global competition.

"RotoHog.com has taken something everybody loves and made fantasy sports even more fun to play," said Faulk during a taped interview. "Anybody can get in on the action and showcase their skills, but you have to beat me to win the $100,000. Do you think you're game?"

In addition to the first-place prize, RotoHog is also awarding cash to every owner who finishes in the top 100 of the Marshall Faulk League. A secondplace finish nets $25,000, while a 75thplace result earns $175. Weekly prizes will also be given away during the season.

Furthermore, RotoHog will reward owners who refer a team that finishes in the money. The prize for referring the top finisher is $50,000.

"We want more people to join," Wu said. "If the person you refer is in the top 10, you're going to be very interested in how they're doing."

For an added twist, RotoHog users can also join bar, radio station or private leagues. Owners in a custom league can enter the same team into the Marshall Faulk League.

Area bars that are participating include the Lamplighter in Camarillo, the Dry Gulch Ranch Saloon and Sunset Ranch & Beach Bar near Malibu, Take Five in Newbury Park, PC's Bar & Grille and Season Ticket in Simi Valley, PJ's Sports Pub in Thousand Oaks and Vinesse in Westlake Village.

KLAC 570AM in Los Angeles has a radio league available for its listeners.

In the future, Wu said he'd like to see his company set up leagues for businesses throughout the nation.

"Fantasy football, and fantasy sports in general, can be a powerful teambuilding tool in corporate America," Wu said. "Companies that set up private leagues for fantasy football, their workers are tight-knit; they work well together and often have a lot of things in common.

"In the past there was concern that fantasy sports did the opposite- created a lack of production. Now researchers are finding it to be a tool that some managers are using to build teams at work."

Wu invites any company who's interested in forming a league to reach out to RotoHog.

"We want all the companies to contact us," he said. "We could set up a 10,000 person Amgen league right now. It could really help improve a business' environment and culture, everything."

Source: http://www.theacorn.com/news/2007/0823/Sports/095.html

A Welcome Home

One Fantasy Sports League is Connecting War Vets

Posted: Friday November 9, 2007 4:19PM; Updated: Friday November 9, 2007 4:19PM
By Melissa Segura

"What you're trying to do is push people to meet each other," says Dan Caulfield, founder and executive director of Hire A Hero.

"The last time I played I stunk terribly," he says. But this time it's about more than standings or scores, but about forming friendships. "Having that kind of outlet available to you is invaluable."

Source: http://sportsillustrated.cnn.com/2007/writers/melissa_segura/11/09/onthemoney/index.html

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